April 13, 1998
Mr. Jonathan Katz
Secretary
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549
RE: SR-NASD-98-21
Dear Mr. Katz:
I am a public investor and would like to inform the SEC of some of the
things I have noticed in my daily trading that affect my ability to
trade and reduce liquidity in the marketplace. The Market Makers are
manipulating the market in the stocks that have a 100-share minimum
quote in a couple of manners:
1) when the market in one of these stocks experiences pressure on
either side of the market, the Market-maker's disappear behind a 100
share quote at the top of the market;
2) they also use a 100 share ECN quote to block movement in a stock and
avoid making a market at their quoted price.
I understand that you are considering extending the minimum quote rule
to the securities currently on the pilot program as well as others in
the NASDAQ. This wills only reduce liquidity and widen the effective
spreads on the stocks because of the above-described manipulation that
all ready occurs. I would ask that you strongly consider keeping the
minimum quotes on all stocks in the NASDAQ at 1000 shares.
Thank you for considering this request. It will only continue to keep
everyone honest and make the marketplace fair for everyone to trade.
Sincerely,
Chester L. Gentry
17301 West Beach Rd.
Austin, TX 78734